CommerceTel Announces Record Second Quarter 2012 Financial Results

SAN DIEGO, CA--(Marketwire - Aug 15, 2012) - CommerceTel Corporation (OTCBB: MFON), an award-winning provider of proprietary mobile marketing technologies and solutions, announced today record second quarter revenue, gross profit and reduced operating losses for the three month period ending June 30^th, 2012.

• Q2, 2012 revenue increased to $1,009,398 from $553,108 in Q2, 2011, an 82% increase.
• Q2, 2012 gross profit increased 81% to $676,940, vs. $374,057 in Q2 2011.
• Gross profit as a percentage of revenue increased to 67% from 64% in the first quarter of 2012.
• Adjusted EBITDA improved 3.9% to ($380,435) from ($395,748) in the previous three month period ending March 31, 2012.

Dennis Becker, President & CEO, was quoted as saying, "2012 has been a busy year for the Company as we've progressed our operational goals and increased the focus on delivering our patented technology to the Local Advertising industry. I'm pleased to report that, as of today, there are more than 5,000 locations across the country utilizing our technology to connect with local consumers' mobile devices. More than 1,500 of those 5,000 users have been turned up just the past 60 days. We've also consolidated the various brands we acquired through 2011 into 'Mobivity' (www.mobivity.com) which better reflects our mission of driving more customers, more often for local advertisers. As previously stated, we continue to project 2012 revenues of more than 60% growth over 2011, and are excited to have recently procured growth capital to expand sales and marketing activities."

The Company raised $1,033,002 through equity issuance in 2011 to fund its growth. In addition, the Company obtained $2,656,250 in new financing via a new Note issued May 31, 2012.

Business Update

The Company continues to grow its Local Advertiser customer base. A Major Quick Serve Restaurant franchise has completed trials in more than 1,500 locations and completed their full nationwide roll out to more than 3,500 locations during June, 2012. The number of locations across the United States currently utilizing CommerceTel's patented mobile marketing solution has grown from less than 1,000 to more than 5,000 locations in just the last 12 months.

During the second quarter, the Company won several major brand client contracts and campaigns including a three-year license to the United States Tennis Association, the Trump Organization's Miss Universe Organization, and the successful execution of mobile fan engagement during the 2012 Final Four NCAA basketball tournament.

On August 6, 2012, the Company filed a document with the Secretary of State of the State of Nevada changing its corporate name to Mobivity Holdings Corp. The name change will be effectuated by merging the Company's wholly owned subsidiary into itself without shareholder approval, as permitted by Nevada law. The name change will become effective on August 22, 2012, which the Company expects is the date that the FINRA will announce the name change. A new Website has been launched marketing the Mobivity brand at www.mobivity.com

Financial Summary

		Three months ended June 30,						Six months ended June 30,
$000s ex-EPS		2012		2011		Chg.		2012		2011		Chg.
Net Revenues		$1,009		$553		82%		$2,023		$694		192%
Gross Profits		$677		$374		81%		$1,322		$259		204%
GAAP Net Income (loss)		($992)		($998)		-1%		($2,684)		($2,310)		16%
Adjusted Net Income (loss)		($380)(1)		($329)		16%		($776) (1)		($758) (1)		2%
GAAP EPS (Diluted)		($0.04)		($0.05)		-8%		($0.12)		($0.12)		0%
Adjusted EPS (Diluted)		($0.02) (1)		($0.02)		0%		($0.03) (1)		($0.04) (1)		13%
Diluted Shares O/S		23,041		21,337		8%		22,920		19,534		17%

(1) Please see non-GAAP reconciliation table below

Non-GAAP reconciliations:
		Three months ended June 30,								Six months ended June 30,
		2012				2011				2012				2011
GAAP Net Income (Loss)		$	(991,545	)		$	(997,985	)		$	(2,683,785	)		$	(2,309,503	)
Depreciation and amortization		$	146,765			$	124,741			$	301,382			$	126,778
Change in FMV of derivatives		$	(654,477	)		$	154,104			$	(193,990	)		$	584,506
Non-cash stock comp expenses		$	257,036			$	251,727			$	640,897			$	596,336
Gain on contingent considerations		$	(16,131	)						$	(76,782	)
Interest expense, net		$	877,917			$	138,242			$	1,236,095			$	243,492
Non-GAAP adjusted net income		$	(380,435	)		$	(329,171	)		$	(776,183	)		$	(758,391	)
Weighted avg. diluted shares			23,041,215				21,336,579				22,920,101				19,534,081
Non-GAAP adjusted EPS		$	(0.02	)		$	(0.02	)		$	(0.03	)		$	(0.04	)

About CommerceTel:

CommerceTel is an award-winning provider of proprietary mobile marketing technologies and the inventor of C4, a unique, enterprise-grade platform empowering brands to engage mobile consumers via multiple channels. The only system of its kind, C4 is a cloud-based solution providing broad mobile communications and extensive CRM features. It is integrated with multiple tier-one PSTN/ IP carriers and micropayment processing facilities as well as with carrier premium SMS billing systems. Customers include CNN, Disney, Sony Pictures, AT&T, Verizon, USA Network, numerous professional sports franchises, the Golf Channel, and NBC Universal. For further information visit www.commercetel.com or follow us on Twitter @CommerceTelinc.

About Non-GAAP Financial Measures

To supplement our consolidated financial statements, which statements are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: adjusted net income. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our "recurring core business operating results." We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting and analyzing future periods. We believe these non-GAAP financial measures are useful to investors because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business.

Cautionary Statement Regarding Forward-Looking Information

This press release may contain certain "forward-looking statements" relating to the business of CommerceTel Corporation. All statements, other than statements of historical fact included herein are "forward-looking statements" including statements regarding the impact of the proceeds from the private placement on the Company's short term business and operations, the general ability of the Company to achieve its commercial objectives, including the ability of the Company to sustain growth; the business strategy, plans and objectives of the Company and its subsidiaries; and any other statements of non-historical information. These forward looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website (http://www.sec.gov). All forward-looking statements attributable to the Company or persons acting on its behalf months are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.